Simmons, Last Year's Sales 285.8 Billion KRW... 6.4% Decrease YoY

Sleep specialist brand Simmons announced on the 5th that it recorded sales of 285.8 billion KRW last year. This represents a 6.4% decrease compared to the previous year.

Simmons cited the sharply frozen domestic consumer sentiment from the end of the third quarter last year as the cause of the sales decline. As the only company in the bed industry operating under a consumer direct transaction 'D2C' (Direct to Customer) retail system rather than a dealership purchasing system, Simmons is the first to sense changing consumer trends at the forefront of the consumer market.

The operating profit margin was 4.1%, down 1.9 percentage points from the previous year. The decrease in operating profit was due to a sharp rise in cost of sales, increased labor costs, and higher rental fees.

Despite a sales decrease of 19.6 billion KRW, the cost of sales surpassed 90 billion KRW (92.23658 billion KRW) for the first time ever, increasing by 2.5% compared to the previous year. Labor costs rose 10.8% from the previous year to 41.0461 billion KRW.

Continuing investments in Simmons Mansion, a consignment store started in 2019, Simmons spent 13.9% more on rent last year than the previous year, totaling 13.29899 billion KRW. Simmons Mansion is a retail store where Simmons headquarters fully supports all related costs such as interior, product display, and promotion for store operators. The stores have been relocated from aging traditional furniture district commercial areas to major key commercial districts with large electronics stores like Samsung Electronics and LG Electronics, as well as imported car showrooms. Store operators have less financial burden and can focus solely on customer service, while consumers can experience a unified brand experience.

At the beginning of this year, Simmons declared an emergency management plan and voluntarily cut executive salaries by 20%. However, employee salaries were increased by an average of 5.9%. Additionally, Simmons declared a price freeze for the second consecutive year this year, following last year.

A Simmons representative stated, “This is a difficult time not only for companies but for all citizens of the Republic of Korea. During a recession, rather than focusing solely on defending company profits, fulfilling corporate social responsibility and taking actions that empathize with consumer sentiment, such as freezing prices, is Simmons’ way to overcome the crisis together.”

This content was produced with the assistance of AI translation services.